From tariffs to interest rates: what could move equipment sales in 2026

"The farm economy experienced a lot of softness, and that's reflected in the numbers. Sales declined across most segments - from high-horsepower tractors to combines - placing 2025 near the bottom of the 20-year sales range tracked by AEM."

"With new combines approaching seven-figure price tags, most purchases rely on credit. Interest rates do matter, noting that tighter margins and higher borrowing costs affect both equipment loans and operating lines."

"Anecdotal reports from the show floor suggest stronger interest in equipment priced under $150,000 and aftermarket precision ag upgrades that extend the life of existing machines."

Farm equipment sales experienced substantial decline in 2025, reflecting broader agricultural economic weakness across all segments including tractors and combines, reaching near the bottom of AEM's 20-year tracking range. While January combine sales in Canada showed percentage gains, these occurred from depressed baseline levels. Equipment purchases remain highly dependent on farm operation confidence and capital availability. Crop prices and financing conditions are critical factors shaping 2026 demand. With new combines exceeding $700,000, most purchases require credit, making interest rates significant. Farmers increasingly seek equipment under $150,000 and aftermarket precision agriculture upgrades to extend existing machine life. Dealer inventory levels have increased from pandemic lows, particularly in high-horsepower segments, while fleet age remains relatively young, potentially limiting replacement demand. Tariff relief, stable interest rates, and research development investments could influence 2026 equipment costs and sales momentum.

Read at Realagriculture